sale of assets in a business sale and remvoal of individual assets in bulk

Forum|Forum|5 years ago
December 11, 2020
1 reply
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If have an S corp who sold substantially all of their assets (basically sold their business) is there a way to remove the individual assets from the depreciation schedule sand group them into line item on the 4797?

ProSeries Professional

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T

TaxGuyBill

Level 15

What do you mean by "group" them? If they are different items, they need to be reported separately. You just enter the sales information on each Asset Entry Worksheet and the sales information for each asset will go onto a separate line on the 4797.

Or are you talking about that you have separate depreciation for the same asset, such as a building with separate improvements that you want to just report as one building sale, rather than the sale of a building and the sale of the separate improvements to that building?

1

14stringAuthor

Level 4

Some tax software allows you to assign each asset to a group...say group 1...then all of the cost basis and prior deprecation shows up on one line on the 4797 and then you can enter the sales price for that group.

This way you do not have to put a sales price for each individual asset on the asset entry worksheets; also in real life an asset allocation schedule often does not specify nor assign a value to every single asset on the sellers depreciation schedule.

I was wondering whether ProSeries has this useful capability?

T

TaxGuyBill

Level 15

If they are different assets, in many cases that treatment is not allowable. They need to be reported separately because gains, losses, and depreciation recapture all need to be factored in for each separate asset because they may be treated differently. Just netting them all will often have a different and wrong result

If it was all part of one asset (such as a house with additional improvements), you are right, some software allows you to 'group' them like that to report it as one item. Unfortunately, ProSeries is NOT able to do that (it seems like they set it up to do that, but it doesn't work). But as I mentioned before, if you have separate assets you are not allowed to combine them anyways.

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